MI: Underlying area: products liability – worker’s compensation
Facts: Plaintiff filed a worker’s compensation claim against his employer after he alleged he had been injured from exposure to chemicals in the workplace. The worker’s compensation claim was settled for $65,000 and paid by the employer’s insurance company. Plaintiff then retained the defendant/attorney to represent him in a products liability lawsuit against the manufacturers of the chemicals from the workplace injury. The products liability claim was dismissed for the attorney’s failure to properly serve the complaint. Plaintiff then sued the defendant for legal malpractice. The legal malpractice claim was eventually settled for $335,000 and the action was dismissed. Plaintiff’s former employer through the insurance company sought to intervene in the legal malpractice case in order to place a lien on the recovery from the malpractice case. The trial court denied the insurance company’s motion to intervene, thus barring any lien on the legal malpractice recovery. The insurance company appealed.
Issue(s): Should an employer or employer’s insurance company be allowed to place a worker’s compensation lien on an employee’s legal malpractice recovery stemming from the same injury the employee got workers compensation for?
Ruling(s): No. The statute that creates the worker’s compensation lien does not allow the lien to be placed on a legal malpractice recovery, the language of the statute cannot be stretched to cover this scenario, even though the policy of worker’s comp law generally prevents double recovery by the employee. Based on the plain language of the statute, a worker’s comp lien will not get to legal malpractice recovery.
Lesson: legal malpractice recovery forms an exception to the general double double recovery rules of worker’s compensation law.
Editor’s Note: For a contrary holding under New Jersey law, see, Frazier v. New Jersey Manufacturers Ins. Co. 142 N.J. 590 (1995).
Posted in: Michigan